More Matter A forgotten thanks

Author: Matty Van Meter

In last week's Campus, a very important number was quietly mentioned in passing: $73,000. This is the approximate annual cost to the College of educating one student. For all the sticker shock associated with the comprehensive fee, the really big number is not how much you shell out to go to the College, but how much the College shells out while you're a student: almost $300,000 for all four years. Now, that's a lot of money.

Private education is a very strange business. More so than most non-profits. To begin with, a substantial number of the employees may not view their employer as a company, and may even become offended if the suggestion is made. The clients (you) are generally oblivious that they are living in a company, which exists only because some people in the administration are very good at getting people to give them tremendous amounts of money. Indeed, the business survives almost exclusively on the beneficence of a huge number of people, and not at all on the gross margin (that is, the money they make on each student, which is negative). According to the Budget Office's website, the price covers, in Middlebury's case, only 68% of the cost of the service, leaving a net annual loss per student of about $28,000; a deficit of $70 million per year. This is huge. Imagine if Coca Cola, or any other for-profit business, sold its product at 68 percent of cost. It wouldn't happen. For every dollar the College spends on you, you pay back 68 cents.

Or do you? According to Student Financial Services 35-40 percent of students receive financial aid, which is taken into account when calculating the cost of education, but is an area in which the College loses a great deal of money. In fact, according to the Budget Office's website, 16 percent of the College's expenditures last year, or about $28 million, were for financial aid, the largest single category after "instruction."

How is this sustainable? The Campus article made mention of a "hidden scholarship," comprised of charitable donations. It may be more than just a scholarship. Every year, enough people give money to cover that $70 million gap between price and cost. They give to capital campaigns to build buildings, give money to aid faculty research (most recently, the much-debated Rehnquist chair), give money for financial aid and, especially, give to the endowment. The Budget Office gives the total market value of the endowment last year as $825 million. This figure is a little misleading, since the College is not allowed to use any of that money. An endowment is money given and invested with the stipulation that the principal (original investment) will never be spent, only the return on the investment (interest, etc.). Still, it is a lot of money selflessly given and comprised 18 percent of the College's revenue last year. People in our administration work very hard to keep this money coming in. It is a thankless job, but one they are good at.

Why do these numbers matter? It is helpful to know, I think, that all that we have here does not come out of thin air. We pay for some of it, or our parents or grandparents do, but much of it, millions and millions of dollars worth, is given to us as a gift. This is good to keep in mind as we load our plates at the dining hall, or settle into a reclining chair looking over the peeking spires and roofs of town to the soft curves of the Green Mountains. It is good to remember that it will be in our hands before long, to provide others with these gifts. Good to remember that it is gifts, regardless of size, stipulation, or the name attached to them, which allow us to live the lives we do here. And so I will say something that most students do not: thank you.